With 1st Panzer Division only 10 miles from Dunkirk (plus 2nd & 6th Panzer Divisions ready to tear up the coast) Hitler maintains his orders to hold them in their current positions. British, French and Belgian forces continue to fall back towards the Channel coast in an orderly retreat, covering each other’s flanks, under pressure by Bock’s Army Group B from the North and West. British Expeditionary Force uses the respite to reinforce defenses around Dunkirk, including the many canals.
Despite Guderian’s orders to leave Calais to the Luftwaffe, 10th Panzer continues to attack. British and French defenders fall back but still hold the city and harbour, where small fishing and pleasure boats begin evacuating the wounded. http://www.dean.usma.edu/history/web03/atlases/ww2%20europe/EuropeanTheaterGIF/WWIIEurope13.gif
In the evening, General Lord Gort decides to withdraw the BEF to Dunkirk, following assurances from War Minister Anthony Eden on May 23 that naval and air forces would be available for an evacuation by sea.